Household Over-Indebtedness in Russia
In the last three years, household debt has risen by a third as disposable income declined. Declining interest rates, ease of access to credit for consumers and poorly regulated microfinance lending practices led to fast growth in consumer debt. Co...
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| Format: | Report |
| Language: | English |
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World Bank, Washington, DC
2020
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| Online Access: | http://documents.worldbank.org/curated/en/518651584539590418/Household-Over-Indebtedness-in-Russia http://hdl.handle.net/10986/33495 |
| Summary: | In the last three years, household debt
has risen by a third as disposable income declined.
Declining interest rates, ease of access to credit for
consumers and poorly regulated microfinance lending
practices led to fast growth in consumer debt. Consumer
lending in the banking and microfinance segments has been
growing in double digits in 2017-2018, reaching a total of
RUB 14,90 trillion (USD 230,8 million), or 14 percent of the
Russian GDP. At the same time, real disposable income has
been declining: as of 2018, it is 13 percent below 2014
levels. Accelerated consumer lending has been monitored by
the Central Bank of Russia to adjust the supply side of
consumer finance, but no in-depth assessment has been made
on how this has been affecting households. To provide a
demand-side assessment, the World Bank Group in cooperation
with the Russian Consumer Protection Service
(Rospotrebnadzor) and the International Confederation of
Consumer Societies (CONFOP) conducted an over-indebtedness
study in 2018-2019. The objective of the study was to take a
deeper look at the increasing levels of indebtedness of`
individuals in Russia, provide a demand-side view on the
issue and assess potential social and economic implications.
The results of the study afford a unique perspective on the
issue of consumer over-indebtedness in Russia and provide
Russian financial-sector regulator and consumer-protection
authorities with additional context for reviewing and
adjusting their existing policies in the area of consumer
protection, responsible lending and related areas. The study
was conducted in a form of a survey covering over 4,000
individuals in 16 Russian regions. |
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